Only birdsong and muttered prayers disturb the tranquil cloisters where men dressed in long, black cassocks make their way to daily mass said in Latin; seminary students with hoes tend the vegetable allotments and check the wooden beehives that shelter beneath a copse of pine trees.

Yet the neo-classical seminary of Our Lady of Corredentora, set in open countryside in the peaceful outskirts of Buenos Aires, is at the eye of a storm that stretches all the way to the gates of the Vatican.

For the past five years, Bishop Richard Williamson has presided over this ultra-conservative religious community in La Reja, but the man behind the international uproar is not receiving visitors.

Neighbours note that padlocks have appeared on the seminary gates. The weekday handouts of food to the local community have also been temporarily suspended, "for summer recess" according to a sign on the administrator's door.

Bishop Williamson is busy with "spiritual exercises", a cassocked novice in the seminary compound told the Guardian. "The seminary is closed for a month-long spiritual retreat and no contact is permitted during this time."

The controversial British cleric certainly does not seem about to break his quasi-monastic routine to answer Pope Benedict's request for clarification of his comments on the Holocaust, which surfaced this week shortly after the Vatican's decision to welcome back into the church four excommunicated bishops, including Williamson.

"I believe there were no gas chambers," Williamson said in an interview with Swedish television last month, claiming that no more than 300,000 Jews died in concentration camps.

It is, a source close to the highest levels in the Vatican told the Guardian, "the biggest catastrophe for the Roman Catholic church in modern times". An exaggeration, perhaps, but the passion with which that judgment was spat out hinted at the tensions that have been aroused by Pope Benedict's move.

His judgment and ability have been questioned as never before, both within his administration, the Roman Curia, and the wider church that he leads. It has unleashed a torrent of Jewish indignation, doubtless setting back the chances of a deal on the status of the Roman Catholic church in Israel, and could yet doom his scheduled visit to the Holy Land in May. Some of the fiercest internal criticism came, not from the dwindling numbers of liberal Catholics, but from the very conservatives who delighted in his election four years ago.

Benedict came to the papal throne as the "law and order" candidate. "The aim of his pontificate has been to restore order to the Catholic church after the tumultuous innovations of the previous incumbent," said Luigi Accattoli, Vatican commentator for Corriere della Sera. "Many of those innovations, particularly with regard to interfaith dialogue and ecumenism, were not always well-received."

It was consistent with his objective that Benedict should have set out to end the Catholic church's only modern schism, formalised in 1988 when Pope John Paul II excommunicated four clerics belonging to the ultra-conservative Society of Saint Pius X (SSPX). The four, who included Williamson, had all been ordained as bishops by the rebel SSPX's founder, Marcel Lefebvre.

Reincorporating the diehards was never going to be easy. Williamson is far from being the only member of the SSPX to question the extent of the Nazi Holocaust. Father Floriano Abrahamowicz told the Tribuna di Treviso, a newspaper in north-east Italy, this week: "I know the gas chambers existed - at least, for disinfecting - but not whether they caused deaths or not."

So far as church unity is concerned, however, it is their theological insubordination that is more relevant. The SSPX was created to provide a spiritual home for those Catholics who refused to accept the liberal reforms of the Second Vatican Council of 1962-65. While many of its innovations have since been interpreted in a restrictive fashion, not least by Benedict, they remain fundamental to any definition of modern Catholicism.

But by lifting the excommunications without demanding any undertaking from Williamson and the others, the pope has angered not just liberals, who see it as capitulation to an unpleasantly reactionary splinter group, but also the many conservatives who admired his insistence on obedience and who feel he has blunted the most fearsome disciplinary instrument in the pope's gift.

Few, in Rome at least, were ready to vent their criticism publicly. But according to one well-informed source, Cardinal Giovanni Battista Re, the senior Vatican official who was told to sign the decree lifting the excommunications on behalf of the pope, "roared" his disapproval of the move.

Defenders of the initiative noted that the decree did not, of itself, heal the schism or settle the issue of the SSPX's future status within the Catholic church. The announcement said it was issued out of "paternal pity".

"What Benedict has said is that this is the first step in a dialogue," acknowledged a prominent British liberal speaking on condition of anonymity. "But that could be very bad for the church as a whole. It is one thing if [the Lefebvrists] come nearer to the church universal. But if the church universal comes closer to them, it matters a great deal."

Some German and Austrian clerics, appalled by Williamson's claim that "only" 300,000 Jews had been exterminated by the Nazis, made their objections clear. But there was also said to be seething discontent in the French church, which has borne the brunt of Lefebvre's rebellion.

According to one source in Rome, a delegation of French bishops was expected at the Vatican next week to protest that they were not consulted on the move. Similar complaints were being aired within the Vatican itself.

By the time Williamson's remarks were broadcast, on 21 January, the decree had already been signed. But had the Vatican's media experts been consulted, they might have suggested freezing the announcement until the British bishop withdrew his remarks - or at least until after the United Nations Holocaust memorial day on 27 January. "Benedict's inner circle needs to have someone who is sensitive to public opinion and can see these problems coming," said the pope's biographer, John Allen.

Back in La Reja, Sabina Medina, a resident who wakes up to the seminary bells at 6am every day, shares the shock that many in the local community feel about Williamson's statement about the Holocaust. "You can't call yourself a real Catholic and hold such absurd views. I'm not certain about his place on Judgment Day," the 52-year-old says.

At the seminary's arched entrance gates, the telephone receptionist arrives for work. Liliana, 53, is a faithful attendant at the seminary's Sunday mass and a firm defender of Bishop Williamson, arguing that his comments were taken out of context. Once at her desk, a quiet day lies ahead of her. The very week that the world is watching and waiting, it seems the seminary's telephone line has providentially gone down.

Profile

Converted to Catholicism in 1971. Later joined the Society of St Pius X (SSPX) and ordained a priest by Archbishop Lefebvre in 1976. Consecrated as bishop without the Vatican's permission he was summarily excommunicated in 1988. Continued his work with SSPX in Argentina, becoming a cult figure among far-right seminarians. On Swedish TV last year he said that no Jews had died in gas chambers. He has also claimed that the US government planned 9/11 and that a Jewish conspiracy to achieve world domination is very real. He says women can be distracted by having their own ideas.